Canada's Christmas Present Is Another Case Of BSE

The Canadian Food Inspection Agency confirmed the diagnosis this week of another case of BSE, this one in a 13-year-old beef cow from Alberta.

The Canadian Food Inspection Agency confirmed the diagnosis this week of another case of BSE, this one in a 13-year-old beef cow from Alberta. It's the 11th confirmed case of BSE for Canada.

Of course, the 11th case doesn't carry near the significance of the first or second, and the announcement isn't expected to have a major impact on the markets nor change Canada's risk status as a controlled- risk country for BSE. That's the designation that allows for the export of beef from Canadian cattle of any age.

While from a scientific or statistical standpoint, this new case is no surprise, it's nonetheless unsettling. While BSE isn't a highly contagious disease, it is relatively easy to control and provides virtually no food-safety risk if safeguards are followed. But it has cost the U.S. and Canadian industries billions of dollars and loonies, respectively. It's also become the mode of choice for raising non-tariff trade barriers around the world.

The reasons for the distortion of the importance of BSE trace to its discovery in Britain, when so little was known of the disease and it caused a panic. Remember that early on there were estimates of a human death toll reaching into the hundreds of thousands. Media coverage was intensive and very inaccurate; and who can forget those images of that staggering Holstein cow.

From a U.S. perspective, this case isn't expected to have much impact. But it does remind us of just how much the industry changed with the discovery of the first U.S. case at Christmastime four years ago and how we still continue to pay the price.

It also points out the abysmal failure of the industry, of USDA, of Congress and the administration to restore our access to foreign markets. While these markets will most assuredly be regained in total some day, the billions of dollars lost thus far will never be recovered.

The blame lies in many directions. USDA and the administration, our cattle, meat and export organizations, and Congress all have played a role in this debacle. But as an industry, we're very fortunate that this episode occurred during a time of record fed prices, strong demand and tight supplies.

Canada is a different story. Its industry -- geared predominantly for export -- was decimated overnight. And the recent weakness of the U.S. dollar has weakened it even more and spurred a faster pace of consolidation.

BSE's immediate impact on the U.S. beef industry was largely overcome by other strong fundamentals. The impact long-term is far harsher. The billions taken out of the U.S. industry have not only limited its ability to take advantage of current opportunities but future ones, as well.

Fundamentally, the industry was in a position for expansion and the healing of old economic wounds. Remember the enthusiasm that dominated the industry in the fall of 2003?

The industry sits today in just a "getting by" position when we should be enjoying well-earned prosperity. Meanwhile, two of our three largest markets remain either closed for all intents and purposes, or their access is greatly limited.